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Bill Cullen is suing Ulster Bank for €120 million over takeover strategy

The suit was filed in the High Court on Monday 19 February.

Jackie Lavin and Bill Cullen
Jackie Lavin and Bill Cullen
Image: Sam Boal via Rolling News

BUSINESSMAN BILL CULLEN has brought a High Court challenge against Ulster Bank Ireland and receivers Kavanagh Fennell for €120 million over the shutdown of his former business.

Cullen’s business Glencullen Group, which was behind the Bill Cullen Motor Group Renault dealerships, consisted of 30 companies and employed 200 people. In 2012, Ulster Bank appointed accountancy firm Kavanagh Fennell as receivers over the company’s assets.

The suit was filed in the High Court on Monday 19 February. The plenary summons outlines that, among other things, Cullen is seeking damages, compensation, an order prohibiting the defendants and their agents from entering into any contract for the sale of properties held by them, and costs.

Accusations

Cullen’s High Court action makes claims similar to allegations his business partner Jackie Lavin made under privilege before an Oireachtas finance committee on 23 January 2017 in relation to the bank’s handling of business customers who were put into the bank’s restructuring unit Global Restructuring Group Ireland (GRG).

With his suit, Cullen is accusing Ulster Bank and the now-defunct GRG of deliberately targeting and shutting down his sustainable business as part of the strategy adopted by Ulster Bank’s GRG.

In 2016, Ulster Bank’s parent Royal Bank of Scotland (RBS) announced a multimillion-euro compensation scheme for SME customers in Ireland and the UK who were treated unfairly by GRG.

Last year, Lavin told the committee the setup resulted in a “deliberate bringing down of businesses in a property grab strategy”. This included the business Glencullen Holdings, which she shared with Cullen.

The Ulster Bank GRG Irish Business Action Group was set up by Lavin to represent 60 Irish companies that were put into GRG.

‘No similar instances’ in Ireland

On Tuesday, the Financial Conduct Authority (FCA) in the UK released a full report under parliamentary privilege which highlighted RBS’s treatment of struggling small businesses that requested financial support during and after the banking crisis (2008 to 2013). 

The document details that there was, in certain respects, “widespread inappropriate treatment” of small businesses by the bank’s GRG.

However, speaking on 1 February to an Oireachtas Finance Committee, Paul Stanley, chief financial officer of Ulster Bank said some of the correspondence in the report is “shocking”, but he had “not seen similar instances” in the Republic of Ireland.

Background

Speaking on a personal basis, Lavin told the committee that Glencullen had been a customer of Ulster Bank since 1990.

Glencullen came into cash flow problems in 2009. It was put into GRG in 2011 and, in October 2012, receivers were appointed to take control of the business.

“Eleven months after GRG took over, the receiver was called in. They took everything, including all our documentation and back up receiver, leaving us nothing to fight with them,” Lavin told the committee.

“In the intervening four years, they have totally refused to give us any documentation on our loans, or payment schedule, or bank accounts in spite of numerous requests,” she said.

In conclusion, under privilege of the committee, Lavin alleged:

Ulster Bank GRG set out a deliberate process to improve its own position at the cost of Irish customers, companies, jobs and lives.

Ulster Bank has been contacted for comment.

Comments are off as legal proceedings are ongoing. 

Read: Ulster Bank accused of a planned ‘property grab’ from SMEs destroyed in post-crash shuffle

More: Jackie Lavin case against Bill Cullen over alleged €1m house purchase deal resolved

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